Point-of-Sale (POS) devices with various capabilities are installed in remote locations. These terminals (or devices) automatically dial to a host processor for approval of a credit card when a customer desires to charge services. The card is typically swiped through a credit card magnetic stripe reader and the data from the stripe is sent to the banking system for approval. If the card is refused, then the merchant clerk does not accept the card as payment for the goods. If the buyer tries to re-submit the card the clerk informs the buyer that the card will not be accepted, thus avoiding the cost of another transaction to the banking system. Also if the card or terminal operation is refused for several other reasons, the merchant clerk is notified by the terminal display and will take action to remedy the situation by calling the banking system for assistance.
In an unattended operation (no sales clerk) such as in a vending machine, a POS terminal will allow a card to be swiped by the user (or consumer). The POS device then dials to the card approving processor and approves the sale or disapproves of the sale automatically. In some cases due to time restraints and depending on the value of the goods to be delivered, the POS device may batch or process the approval for the card after the fact of providing the merchandise. In this case, the vendor of the goods takes the risk if the card is not approved (rejected). In addition, in unattended operation, the consumer may try to use the card over and over since there is not clerk present to block this activity.